Major automobile manufacturers may shout to the world that they are on the brink of bankruptcy, but bosses of smaller, family run businesses (like the majority of label converters) would rather be thrown naked into a vat of vipers than admit to any kind of financial difficulty. That said, the mood in the French label converting sector – which your correspondent has been investigating – could be summed up as “concerned, but resolute.”
JPL, one of France’s leading narrow web converters, went on an acquisition spree last year which could, in theory, at least spell trouble now that storm-clouds are lowering. Not so, says owner-manager Philippe Leyval, who cut a lot of dead wood from the acquired companies, while reorganizing and centralizing marketing, purchasing and administrative funtions. The main strength of the newly streamlined JPL group, he says, lies in the fact that it makes labels for a wide range of end-user sectors.
“The fourth quarter 2008 was terrible for the food sector,” Leyval admits, “but cosmetics labels were not so badly hit and the pharma sector was almost normal. At the same time, we have been doing good business with sleeve labels, a new product for us.” Another owner-manager, Patrick Wack of 5/7 Etiquettes in the south of France, is also not waving the white flag. “Our traditional label products are down by 10 to 20 percent from January/February 2008, but the innovative, high value-added label products are doing well,” he says. Both companies, like others in the French label converting business, acknowledge that they have shelved all major investment plans for the time being, while at the same time stoutly denying that they have laid off permanent staff. This is not too surprising in a country where it is notoriously difficult to fire staff. Anecdotal evidence nonetheless confirms that French label converters have generally stopped hiring and are not renewing fixed-term work contracts.